S T A T E   O F   N E W   Y O R K
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                                  4739

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             April 19, 2013
                               ___________

Introduced  by  Sen. ADDABBO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Civil Service and Pensions

AN ACT to amend the retirement and social security law, in  relation  to
  allowing a buyback of certain military service credit

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivisions 1, 2, 4 and 5 of section 1000 of  the  retire-
ment  and  social  security  law, as added by chapter 548 of the laws of
2000, are amended to read as follows:
  1. A member, upon application to such retirement system, may obtain  a
total  not  to  exceed  [three]  FIVE  years of service credit for up to
[three] FIVE years of military duty, as defined in section  two  hundred
forty-three  of the military law, if the member was honorably discharged
from the military and all or part of such military service was  rendered
during  the following periods: (a) commencing December seventh, nineteen
hundred  forty-one  and  terminating  December  thirty-first,   nineteen
hundred  forty-six; (b) commencing June twenty-seventh, nineteen hundred
fifty and terminating January thirty-first, nineteen hundred fifty-five;
or (c) commencing February twenty-eighth, nineteen hundred sixty-one and
terminating May seventh, nineteen hundred seventy-five;
  2. A member, upon application to such retirement system, may obtain  a
total  not  to  exceed  [three]  FIVE  years of service credit for up to
[three] FIVE years of military duty, as defined in section  two  hundred
forty-three  of  the military law, if honorably discharged therefrom, if
all or part of such services was  rendered  in  the  military  conflicts
referenced below, as follows:
  (a)  hostilities  participated in by the military forces of the United
States in Lebanon, from the first day of June, nineteen hundred  eighty-
three  to  the  first day of December, nineteen hundred eighty-seven, as
established by receipt of the armed forces expeditionary medal, the navy
expeditionary medal, or the marine corps expeditionary medal;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09926-02-3
              

S. 4739                             2

  (b) hostilities participated in by the military forces of  the  United
States  in  Grenada,  from  the  twenty-third  day  of October, nineteen
hundred eighty-three to  the  twenty-first  day  of  November,  nineteen
hundred  eighty-three,  as  established  by  receipt of the armed forces
expeditionary  medal,  the navy expeditionary medal, or the marine corps
expeditionary medal;
  (c) hostilities participated in by the military forces of  the  United
States  in  Panama, from the twentieth day of December, nineteen hundred
eighty-nine to the thirty-first day of January, nineteen hundred ninety,
as established by receipt of the armed forces expeditionary  medal,  the
navy expeditionary medal, or the marine corps expeditionary medal; or
  (d)  hostilities  participated in by the military forces of the United
States, from the second day of August, nineteen hundred ninety,  to  the
end  of  such hostilities in case of a veteran who served in the theater
of  operations  including  Iraq,  Kuwait,  Saudi  Arabia,   AFGHANISTAN,
Bahrain,  Qatar,  the  United Arab Emirates, Oman, the Gulf of Aden, the
Gulf of Oman, the Persian Gulf, the Red  Sea,  and  the  airspace  above
these locations.
  4.  To  obtain such credit, a member shall pay such retirement system,
for deposit in the fund used to accumulate employer contributions, a sum
equal to the product of the number of years of  military  service  being
claimed  and  three  percent of such member's compensation earned during
the twelve months of credited service  immediately  preceding  the  date
that the member made application for credit pursuant to this section. If
permitted by rule or regulation of the applicable retirement system, the
member may pay such member costs by payroll deduction for a period which
shall  not  exceed  the  time  period of military service to be credited
pursuant to this section.   FOR ANY CURRENT MEMBER  APPLYING  TO  OBTAIN
SERVICE  CREDIT  IN ADDITION TO A TOTAL OF THREE YEARS OF SERVICE CREDIT
ALREADY OBTAINED, SUCH MEMBER SHALL  PAY  SUCH  RETIREMENT  SYSTEM,  FOR
DEPOSIT  IN  THE  FUND  USED  TO ACCUMULATE EMPLOYER CONTRIBUTION, A SUM
EQUAL TO THE PRODUCT OF THE NUMBER OF YEARS OF  MILITARY  SERVICE  BEING
CLAIMED  AND  THREE  PERCENT OF SUCH MEMBER'S COMPENSATION EARNED DURING
THE TWELVE MONTHS OF CREDITED SERVICE  IMMEDIATELY  PRECEDING  THE  DATE
THAT THE MEMBER MADE HIS OR HER FIRST APPLICATION FOR CREDIT PURSUANT TO
THIS  SECTION.    IF  PERMITTED  BY RULE OR REGULATION OF THE APPLICABLE
RETIREMENT SYSTEM, THE MEMBER MAY  PAY  SUCH  MEMBER  COSTS  BY  PAYROLL
DEDUCTION  FOR  A PERIOD WHICH SHALL NOT EXCEED THE TIME PERIOD OF MILI-
TARY SERVICE TO BE CREDITED PURSUANT TO THIS SECTION. In the  event  the
member leaves the employer payroll prior to completion of payment, he or
she  shall  forward  all  remaining required payments to the appropriate
retirement system prior to the effective date of retirement. If the full
amount of such member costs is not paid to  the  appropriate  retirement
system  prior to the member's retirement, the amount of service credited
shall be proportional to the total amount of the payments made prior  to
retirement.
  5. In no event shall the credit granted pursuant to this section, when
added  to credit granted for military service with any retirement system
of this state pursuant to this or any other provision of law,  exceed  a
total of [three] FIVE years.
  S 2. This act shall take effect immediately and shall apply to current
and future members.
  FISCAL  NOTE.--  This bill would increase the amount of eligible mili-
tary service credit under Chapter 548 of the Laws  of  2000  from  three
years  to five years. In addition, this bill will extend the benefits of
such Chapter to members of public retirement systems in New  York  State

S. 4739                             3

who rendered military service during the period of conflict in Afghanis-
tan and were assigned to the theater of operations. Members must have at
least  five  years of credited service (not including military service).
Tier 1-5 members would be required to make a payment of three percent of
their  most  recent  compensation  per year of additional service credit
granted by this bill.   Tier 6 members  would  be  required  to  make  a
payment  of  six  percent  of their most recent compensation per year of
additional service credit. For those members who have already  purchased
three  years of such credit that will now be permitted to purchase up to
two additional years of service credit, the  member's  payment  will  be
based on the compensation used in the initial calculation.
  If this bill is enacted, insofar as this proposal affects the New York
State and Local Employees' Retirement System (ERS), it is estimated that
the  past service cost will average approximately 12% (9% for Tier 6) of
an affected members' compensation for each year  of  additional  service
credit that is purchased.
  Insofar  as  this proposal affects the New York State and Local Police
and Fire Retirement System (PFRS), it is estimated that the past service
cost will average approximately 17% (14% for  Tier  6)  of  an  affected
members'  compensation  for  each  year  of  additional  service that is
purchased.
  The exact number of current members as  well  as  future  members  who
could be affected by this legislation cannot be readily determined.
  ERS Costs: Pursuant to Section 25 of the Retirement and Social Securi-
ty  Law,  the  increased cost to the New York State and Local Employees'
Retirement System would be borne entirely by the State of New  York  and
would  require  an  itemized appropriation sufficient to pay the cost of
the provision. Since a member can apply for this service credit  at  any
time  prior to retirement, a precise cost can't be determined until each
member, as well as future members, applies for the service credit. Every
year a cost will be determined (and billed to the state) based on  those
benefiting from this provision.
  PFRS  Costs:  These casts would be shared by the State of New York and
the participating employers in the PFRS.
  Summary of relevant resources:
  Data: March 31,2012 Actuarial Year  End  File  with  distributions  of
membership  and  other  statistics  displayed  in the 2012 Report of the
Actuary and 2012 Comprehensive Annual Financial Report.
  Assumptions and Methods: 2010, 2011 and  2012  Annual  Report  to  the
Comptroller on Actuarial Assumptions, Codes Rules and Regulations of the
State of New York: Audit and Control.
  Market  Assets  and GASB Disclosures: March 31,2012 New York State and
Local Retirement System Financial Statements and Supplementary  Informa-
tion.
  Valuations  of Benefit Liabilities and Actuarial Assets: summarized in
the 2012 Actuarial Valuations report.
  I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the actuarial opinion contained herein.
  This estimate, dated April 2, 2013 and intended for  use  only  during
the  2013  Legislative Session, is Fiscal Note No. 2013-112, prepared by
the Actuary for the New  York  State  and  Local  Employees'  Retirement
System  and  the  New  York  State  and Local Police and Fire Retirement
System.